Personal Responsibility

February 23, 2013

A fellow named Vince recently explained to me that he had once been a Democrat, but finally concluded that his political leanings were the result of an unfortunate personal flaw - a tendency to blame circumstances for his misfortunes. So, Vince resolved to embrace personal responsibility and, with it, a conservative political perspective that rejects the welfare state and holds individuals responsible for their success or failure.

Vince's outlook reminded me of a time years ago when I assessed a well-known weight loss company's business model. The company sold memberships that entitled customers to a given number of meetings, by the end of which they were told they would lose the amount of weight they desired and would be trained to keep it off.

In fact, more than 90 percent of customers failed to meet their weight loss goals and, even among those who succeeded, few kept the weight off. Despite these abysmal results, customers came back again and again, buying on average five memberships before giving up.

More distressing was the fact that the company expected its members to fail. Its business model even depended on it. The company didn't begin making a profit on a customer until halfway through the third membership.

But, why did customers go along? Why did they keep returning to a program that almost always failed to deliver on its promise? Focus groups revealed the answer. Customers didn't blame the program. They blamed themselves. Their refrain was, "If I had only stuck with it."

This assumption of personal responsibility would have made sense if most or even many of those in the program had been able to stick with it. But, almost none did, which suggested the program itself was flawed and that it, not customers, should bear most of the responsibility for failure.

Sadly, the same can be said of today's economy and the inability of many Americans to claw their way to prosperity. As noble as Vince and others are in assuming responsibility for their economic wellbeing, that sentiment should not blind them or us to economic conditions and policies that, like the weight loss program, make success all but impossible for many people, including many who try fervently.

America was once "the land of opportunity." Unlike Europe's class-bound societies where opportunities for upward social mobility were few, America was a place where anyone from any station in life could become a success. Some say it's still true. But, it's not.

For decades, as wealth drained from middle and low income workers and became more heavily concentrated among the wealthiest Americans, one industrialized country after another surpassed us in the share of people able to escape poverty. Americans who are born into the bottom income quintile are 35 to 45 percent less likely to escape poverty than their counterparts in Canada, Germany, Britain, Denmark, Finland, Norway and Sweden. The numbers who fail are even greater in West Virginia, where a third of our children are trapped in the unfortunate bottom quintile.

And the poor don't fail because we coddle them. All of the countries mentioned above redistribute more income and provide more generous public assistance than does the United States. They also provide universal healthcare.

For years conservative commentators have decried social safety net programs for creating a "culture of poverty" in which generations of families remain mired in dependency. They ridiculed investments in education, worker training and child nutrition as "throwing money at problems." And their views carried the day in congress and state legislatures, which cut benefits for poverty-related programs and shifted more of the cost of going to college to students and families.

The money saved by these measures was used to finance tax cuts for businesses and the wealthy, whose rates, even after recent increases, are still less than half of what they once were. Meanwhile, in the private sector, although worker productivity has grown for decades, the share of revenue that businesses allocate for worker wages and benefits and investment has reached generational lows, while the amount allocated to executive compensation and profits has skyrocketed.

We were told these policies would stimulate job growth and counteract the culture of poverty by restoring necessary incentives to work and invest. But they've done the opposite. Social and economic mobility is at an all-time low. America's economy, like the weight loss program, doesn't deliver for customers, particularly those at the middle and lower end of the income scale, including many who take personal responsibility and "follow the program." And in economics, unlike in weight loss, there's only one program from which to choose.

Still, calls persist to slash entitlement programs. In West Virginia, governor Earl Ray Tomblin wants to reduce funding for higher education while further cutting corporate taxes, thereby reducing the ability of young people to go to college in a state that's last in the nation in educational attainment. This despite multiple studies showing that ameliorating childhood poverty and making college affordable are among the most effective actions we can take to lift new generations out of poverty.

President Obama's proposals to raise the minimum wage and guarantee access to preschool will alleviate some of these ills. Still, more broad-based action is needed to reduce income inequality and counteract the effects of poverty. But, it won't happen as long as we're seduced by the myth that equal, or at least sufficient, opportunity already exists for those willing to assume personal responsibility.